Lovestuck: How to better utilise data and the irony of meeting your match online

"Know your customer," says Samir El-Alami, director for online marketing at the well-known online dating site Lovestruck.com. El-Alami, an engaging, charismatic 27-year-old who clearly believes in his product, argues that the best way to find and retain customers in the online dating world is to know who they are, and therefore what they're trying to find.

The problem with the information customers provide when signing up for online dating is that people tend to write about themselves in some ideal, but not necessarily real, way.

Personally, I'd rather a bunch of strangers on an online forum think I'm a sociable extrovert and fantastic football player, rather than the reality that I only played football as a kid and I'm currently sitting in a dark room writing this post up right now.

Speaking at this year's Europe's Customer Festival – centred on the themes of customer loyalty and Big Data – El-Alami described the various algorithms used at Lovestruck that are intended to most effectively use customer data.

You might find that if you go to Lovestruck.com to have a look around, you'll have a lot more ads for Lovestruck displayed above your Gmail inbox and YouTube videos.

Data as ostensibly trivial as the videos you've watched and the articles you've read can be used surprisingly well to match you to another human being. Perhaps even more effectively than the information you provide about yourself when signing up.

El-Alami says that "data ought to be used effectively," which, in a world where every computer-using person generates astronomical bits of data, is potentially good for both customer and corporation. If I believe that the data I generate when surfing the web is going to be used to secure me a life partner, why wouldn't I sign up for the service?

The picture El-Alami wants us to see is the following: Lovestruck.com uses your everyday data to your romantic benefit at a reasonable cost. And it has the banners of happy married couples to prove it.

There's only one problem: customer acquisition and retention are ultimately a "conflict of interest."

Many people who join Lovestruck would like nothing more than to meet their soul mate after a few weeks using the service. But by definition, those who find their soul mate will (or at least should) cease to be paying users.

This leaves two possibilities for a successful online-dating business model. The first is an extremely high-volume of users coupled (get it?) with an extremely high success rate. But that's unlikely, if for no other reason than there's a great deal of competition in the world of online dating, and the number of temporary paying users would have to be astronomical for the business to succeed.

The second – and far more likely possibility – was not so much said by El-Alami as it was implied when he claimed that "[customer] retention starts with acquisition." Users are encouraged to "stick with it," which is to say, to keep up with their membership even if their first several dates aren't successful.

The consequences for the business model are this: despite a small percentage of successful users who serve as poster-children for the corporation, it's best for Lovestruck, financially speaking, if people continue to use the service indefinitely, without ever actually meeting a life partner.

Shortly put, the model for successful dating sites will be reliant on a large base of retained users, which is to say, users who believe the service will work for them when there's no chance of it really doing so.

But the business model is something to think about when deciding whether to message people online and blog in a dark room for the evening, or just to go out like (mostly) everybody else.

This post came courtesy of Europe's Customer Festival guest blogger Jonathan Goodman, an American postgraduate student who received his MA Philosophy degree at University College London and is currently studying for his PhD in Philosophy at Birkbeck College.